The City of Madison's Community Development Division will consider a loan subordination request where the subordination results in one of the following:

  1. Non-cash out simple refinance, such as interest rate reduction and/or there is a mortgage loan product change (e.g. when a balloon or adjustable rate mortgage (ARM) matures and the owner switches to a fixed product). The new first mortgage loan cannot exceed the current mortgage loan balance secured ahead of the CDD loan (excluding reasonable lender fees).  
  2. Cash out can only be used for home improvements.

Lenders can find additional information and requirements on how to request a Subordination on a City loan in the City’s Subordination Checklist ; City's Subordination Policy-Residential; and the City's Subordination Policy-Rental, Multi-Family, Facility.

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